Marketing research company Vericast found that although Americans consume more than three billion pizzas per year, about 40% of consumers have no preference as to where the pizza is from. Vericast is a partner to 170 pizza companies, including the top 10 national brands.
According to research compiled by the company, 13% of recent restaurant pizza consumers are now opting for frozen or grocery store pizzas instead of restaurant or takeout pizzas due to rising costs. Moreover, 43% of recent restaurant pizza consumers also purchased grocery store pizzas in a typical week.
In its 2023 Restaurant TrendWatch report, Vericast surveyed nearly 2,000 US adults about their pizza and food purchasing habits. The report found that 64% of surveyed consumers believe dining out is too expensive due to inflation. At the same time, 41% of those surveyed said that rising grocery store prices mean it’s not always cheaper to eat at home.
“Based on sales and traffic numbers, some believe the big four pizza brands (Domino’s, Pizza Hut, Papa John’s and Little Caesars) are consumers’ first pick, but when we dig a little deeper, we found that the top choice is actually ‘no preference,’” said Dana Baggett, client strategy director, Restaurant Division at Vericast. “This lack of preference and loyalty means consumers can be swayed to change brands with incentives.”
In the last two years, retailers have increased promotions for frozen pizza brands 214%, according to Vericast. Data from the TrendWatch report showed that 18% of pizza consumers — primarily millennials, millennial parents and parents in general — opt for less expensive brands and restaurants when given the choice. For those who order pizza from restaurants at least once a week, 25% will opt for the less expensive choice.
“The pizza battle is on, and grocery stores are winning,” Ms. Baggett said. “Consumers are shifting to at-home pizza, resulting in the big four pizza players losing 3% share of wallet compared to same time last year, according to Numerator. If they convert just 5% of their guests who purchase frozen pizza each month, they could earn roughly $500 million collectively. Brands who deliver targeted offers across digital and print channels will win loyalty and business.”
To combat rising prices, 50% of surveyed consumers said that coupons and discounts helped determine where and what to eat. For frequent pizza consumers, 58% said that a coupon or discount had changed where they bought a pizza in the 30 days before the survey. Further, nearly 80% of respondents said they spend more at a restaurant when they are using a coupon or discount.
